Expert: Economic growth to be ‘incredibly slow’
ACROSS MISSISSIPPI — Mississippi will have anemic economic growth this year and next, an expert told lawmakers yesterday.
State economist Darrin Webb said economic conditions in the state and nation have deteriorated the past six months. The earthquake in Japan and an increase in oil prices during the spring sparked the uncertainty, and that was made worse by congressional squabbling during the summer about whether to increase the federal debt limit, he said.
He said the state economy was hurt by Mississippi River flooding during the summer, and by tornadoes that struck the central and northeastern parts of the state in the spring.
Webb presented his economic outlook to the 14 members of the Joint Legislative Budget Committee, who are starting to plan state spending for the fiscal year that begins July 1.
He estimated Mississippi’s economy will grow only seven-tenths of 1 percent this year and about 1.7 percent in 2012.
“We’re growing, but the growth is at an incredibly slow pace,” Webb said.
Over the past 20 years, Mississippi averaged 2.7 percent annual economic growth during expansions, Webb said.
The state and national economies have been in recovery for more than two years, but employment has not returned to pre-recession levels, he said. Mississippi hit its highest level of employment in February 2008, then hit a low point in February 2010. It lost almost 77,000 public- and private-sector jobs during that time, a 6.3 percent drop.
“The recession has been very deep, and this recovery has been incredibly slow, and so we have a long way to go,” Webb said.
Several other states in the Southeast are having an even harder time bouncing back, he added.
“We were already struggling when the recession began. So, we had less to lose,” Webb said.
Webb’s report was sobering for the lawmakers.
“I’ve seen more joy in my morgue than I heard here today,” said Rep. Steve Holland, D-Plantersville, who’s an undertaker.
Mississippi has a budget of about $5.5 billion for the current fiscal year, which ends June 30. Legislators have not yet estimated how much revenue will be available to spend in the coming year — but they’re already getting requests for significant increases from several agencies, including the Department of Mental Health and the Division of Medicaid.
Lt. Gov. Phil Bryant, who’s on the Budget Committee, is also the Republican nominee for governor in the Nov. 8 general election. He said money minders would have to make tough decisions.
“Caution is certainly the word here,” Bryant said.
The state Department of Corrections is not requesting a budget increase, Corrections Commissioner Chris Epps said yesterday.
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